Deepening regionalism in Europe and ASEAN – the role of an economic constitution

Abstract

The article examines the creation of an internal market in Europe and Southeast Asia from the perspective of constitutional economics. It assesses whether the success or failure of a regional integration process depends on the quality of the economic constitution that is chosen by participating countries, that is, on the set of rules and institutions, which bind the actions and transactions of operators within a jurisdiction and towards the operators of other jurisdictions. The article commences with an overview of the analytical instruments of constitutional economics in order to evaluate the success of a regional agreement on the basis of the ‘quality’ of its economic constitution. It then examines internal market creation in the EU and the Association of Southeast Asian Nation (ASEAN). The article concludes that it is the commitment to the implementation of a social contract that determines the successful establishment of a single market.

Keywords:

• constitutional economics
• regionalism
• integration
• Europe
• ASEAN
• single market

JEL classifications:

• F13
• B52

Notes

1. These include air travel, agro-based products, automotives, e-commerce, electronics, fisheries, healthcare, rubber-based products, textiles and apparels, tourism and wood-based products.

2. Pitsuwan notes that tariff liberalisation is very close to the full realisation of establishing ASEAN Free Trade Area. Average tariff is down to 1.95% in 2008, from 4.43% in 2000. Emphasis is now placed on removing non-tariff barriers to trade and enhancing trade facilitation such as customs, standards and conformance, to further boost intra- and extra-ASEAN trade.